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Wharton Tackles Why The Housing Market Sucks
Not to end the week on a downer, but I ran across an interesting study on the current state of the national housing market (there are plenty of analyses to go around, I know).
The Wharton University School of the University of Pennsylvania tackles the housing crisis in a special report, The Subprime Crisis, How Wall Street Alchemists, Ambitious Lender, Overreaching Consumers and Enabling Lawmakers Pushed the Economy to the Brink of Recession, and How to Avoid a Repeat.
Here’s a summary:
Youtube link to Wharton Summary of the Subprime Crisis
With articles, interactive features, podcasts, opinions, etc., it’s a comprehensive view the of housing mess we’re in nationally.
Their conclusion? Bottom line, it comes down to greed. No surprise there. It’s part of the human condition.
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6 Responses to “Wharton Tackles Why The Housing Market Sucks”
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FYI: Wharton is not a university, but the renowned undergraduate and graduate business school of the University of Pennsylvania.
Corrected. I knew it didn’t sound right but didn’t circle back to get it straight. Thanks for the catch.
[...] digesting Wharton’s subprime research, housing wonks will want to grab a copy of Harvard University’s report, The State of the [...]
Ron, what’s your take on the final sales price vs. listing price for the Lake O homes sold last week (property blotter). Some buyers got some significantly large discounts. I know it’s difficult to generalize and I know you don’t know each one’s situation but wanna through some educated ideas out there? Thanks, Leigh
throw! not through! how about an educated question from bearlee!? hahaha I shall proof read next time…
Bearlee,
One of the properties was on the historic register, which complicates how the property can be developed, remodeled, etc. I don’t have any specifics about the other highly discounted properties.
My guesses:
* Urgent need to sell
* Poor pricing methodology from the outset
* Defects or other issues found during the inspection
* Agressive buyer activity
* Property handled by relocation company who didn’t want to hold it long.
All speculation….
Most showed ~10% price drops, which isn’t far off the 92% or so of the average list to sale price across the market as a whole. In our analysis, we are going back beyond the current listing, and including any previous listings since the previous sale.
In our West Linn analysis ( http://www.move2westlinn.com ), we are now seeing some banks settling short sales at significantly reduced prices. We’ll see if this is a blip, a trend, or a wave.